B yChika Otuchikere
The Federal Inland Revenue Service (FIRS) has directed landlords and property agents to begin to charge 6 per cent Stamp Duty on all tenancy and lease agreements they enter into with all renters and remit same promptly to the Service so that they do not run foul of the Stamp Duty Act.
The directive came following the recent release and wide circulation of a stamp duty clarification guide by Executive Chairman (FIRS) Mr. Muhammad Nami.
According to Mr, Nami, property-related transactions like tenancy or lease agreement fall under the Ad Valorem category of the stamp duty which attracts 6 per cent duty payable in percentage of the total value or sum of the tenancy or lease.
The burden of payment of the 6 per cent lies on the beneficiary of the tenancy or lease agreement, whom the Stamp Duty Act identified as the tenant or renter and the responsibility of collection and remittance fall on the landlord or agent in charge of the property for lease or rent, according to a statement issued on Wednesday by Director, Communications and Liaison Department, FIRS, Abdullahi Ismaila Ahmad.
Mr. Nami stressed that “in any case, the party making the payment shall have the obligation to account for the applicable stamp duties.”
Some other Stamp Duty types and their rates are Appraisement or Valuation of Property, 1.5%; Certificate of Occupancy, Partnership N1,000 flat rate; Gift of Land, 1.5%; Legal Mortgage, 0.375%; Legal Mortgage (Upstamping), 0.375%; Deed of Conveyance or Transfer on Sale of Property, 1.5%; Gift of Land, 1.5%; Memorandum of Understanding (Related to Land, Sales, Joint Venture, Surrender, Subdivision Agreements, 1.5%; Power of Attorney (Irrevocable/Land Related), 1.5%; and Sales Agreement, 1.5%.